I am reading the most pretentious and verbose label ever attached to tea towel. If it were a caption next to a work of contemporary art, you would think it excessive. The towel, to give you a condensed version, “twists the traditional expression of a kitchen textile”; with “a vibrant mélange look”, achieved by doing interesting things to yarns and twill stripes, it “adds a contemporary edge to the kitchen”. The tea towel costs £15. Fifteen pounds! Enough to say that it’s a very nice towel, if not one worth the price nor the word count on the label, and that it epitomises a certain sort of contemporary retail that is writ large in the shopping development around it, Coal Drops Yard in King’s Cross, London.

That is to say, it is a thing of use and craft repackaged by design and marketing so as to soak up some of the surplus value sloshing around the credit-card accounts of the modern well-healed urbanite. It touches a desire for the artisanal, a nostalgia for the authentic and the workaday, for those very things that are squeezed out of city life by the self-same economic forces that enable a high-end, 9,290 sq metre, £100m shopping complex such as Coal Drops Yard to come into being in what was formerly an industrial, and then an ex-industrial, badland.

And so it is with Coal Drops Yard as a whole, which is formed out of the two long Victorian sheds through which south Yorkshire coal was once transferred, at a rate of 8m tonnes a year, to horse-drawn carts and thence taken to heat the homes and businesses of London. Which facility, dealt fatal blows by competition from other sources of power, fell into decay. One part was gutted by fire. Another was colonised by Bagley’s nightclub, which until it closed in 2007 held raves 2,500-strong. They formed part of a wider zone of dereliction branded by its prostitution and drug-dealing, even as respectable light industrial businesses continued to ply their trade.

This zone is now a fading memory, having been made into its near-opposite by the developers Argent – clean, prosperous, safe and managed, where before it was dirty, rundown, risky and anarchic. Service industries replace industrial industries. Yet it keeps mementoes of its former state, such as gas holders, storage buildings and canal and railway structures, partly because their retention is required by policies about historic buildings, but also because they add to the attraction of the place.

The upper deck of shop units of Coal Drops Yard with the Gasholder residential development behind. Photograph: Luke Hayes

Coal Drops Yard, where established brands such as Aesop and Paul Smith are combined with a careful selection of newcomers, is a culminating point in the almost-complete transformation of King’s Cross. It is part of the development’s coming-out as a frankly posh place, having previously taken care to dress down, to take both symbolic and material steps to make itself part of the everyday London demotic. It is a place where, at the exceptional tapas joint Barrafina, you can experience the most exquisite pureed beetroot of your life, at a high price.

The yard lets itself go architecturally: having previously favoured some of Britain’s more meticulous and measured architects, Argent has now enlisted the help of the design Aladdin Thomas Heatherwick. With a rub of his magic lamp, he has caused the slate roofs of the two long sheds to soar from their supporting brickwork and meet above a central void in an airborne kiss. With the same rub he has made a hefty chunk of additional retail space, enough to contain a Samsung “creative and digital playground”, in a location where the official guardians of historic buildings would normally look askance at such a thing.

Heatherwick’s superstructure grabs attention, which is what shopping centres tend to do, and he does it with more chutzpah than most. It first gives an instant and Instagrammable visual hit; later it delivers a view over surrounding rooftops which Samsung’s patrons will enjoy when its store opens early next year. Heatherwick’s team have created some meaty and pleasing details in the historic structures underneath and nicely inserted staircases and walkways into the old shells, with unglazed arches conveying an aura of ruins. But the sheds are overwhelmed by acting as launchpads for the main architectural event. The underworld formed beneath the flying Samsung playground feels a tad glum.

Vogue has called the shopping centre “progressive”, which is a striking adaptation to retail of a word more often linked to political idealism. Heatherwick told the Daily Telegraph of the project’s social value: “With the decline in other public gathering points,” he said, “church, for example, or public libraries and community centres which aren’t being financed now – we need places to come to for human interaction.” Time to give up on civic life, he seems to be saying, let’s go shopping.

Language like this rinses substantial concepts of their meaning, the better to use them as marketing. A library, a shop – what’s the difference? It seems to confirm what critics of the King’s Cross development argue, that it is really about expanding the wealthy core of London into an area that was previously mixed, and that its values are ultimately those of retail and property. For Michael Edwards, a planning expert at University College London and a King’s Cross campaigner since the 1980s, “there’s very little there for people on low income or needing public services”. It’s part, he says, of a London-wide process whereby “big capital squeezes out anything noisy, anything scruffy, anything that can’t pay higher rents”.

Inside Tracey Neuls’s shoe shop, one of many new high-end outlets. Photograph: John Sturrock

The rhetoric of Coal Drops Yard certainly raises some questions about both the successes and limits of the model that King’s Cross exemplifies, where developers, with the help of some nudges from public bodies and local groups, are the primary makers of cities. Developers become de facto mayors and planners, directing the provision of public good. They decide everything from the design of public and private buildings to the management and policing of open spaces. How far can the skill sets of benign administration and financial speculation be combined in one organisation? And, no matter how enlightened and intelligent a developer might be, what is to stop the profit motive finally taking over?

Any assessment of the King’s Cross development has to acknowledge that it is the best of its kind, this being the transformation of a large area of a major British city by a single developer. Comparisons might be made with Birmingham’s Bullring and Liverpool One, which are both dominated by retail, or by the office-led Canary Wharf and Broadgate developments in London. The King’s Cross idea has always been to create what the development’s director Robert Evans calls “a part of London, a layered, complex, eclectic piece of the city,” which means it has several different uses.

You know that if anything genuinely challenging happened here it would be escorted off the premises

Detractors might ask, in the manner of Life of Brian: what has Argent ever done for us? Nothing, would be the answer, except for the mixture of businesses, homes and education, the many jobs, the primary school, the pleasant and accessible open spaces, the lawns and fountains, the restored historic buildings, a proposed theatre, and a 40% ratio of affordable housing.

Across the whole 27-hectare (67-acre) King’s Cross site you can see the judicious detailing arising from the judicious choice of leading and emerging architects that this year won Argent the accolade of client of the year from the Royal Institute of British Architects. In the centre is the Central St Martins arts college, housed since 2011 in a conversion of Lewis Cubitt’s impressive 1852 granary building. This is a win-win for both Argent and the academic institution, whereby the latter got a handsome new home and the former found its property animated, which was particularly important in its fragile early years, by thousands of creative and stylish art students.

At the heart of it all is Granary Square, a paved area in front of the granary building. In warm weather children play in the vertical jets of water that rise from the ground. People lounge on steps descending to the Regent’s Canal or gather to watch major sporting events on a big screen. Off to the side you can browse a bookshop in a moored narrowboat, from which wafts the sounds of jazz trumpet. Off to another is the Camley Street Natural Park, an achievement of 1980s community activism, once threatened with destruction, now preserved and flourishing.

Art students float through, dressed in their takes on the bohemianism of the past 100 years: oh look, there’s David Bowie, or Samuel Beckett, or Siouxsie Sioux, or Gertrude Stein, or Yoko Ono, or Kerouac, or Warhol. Anyone is welcome, as long as they obey the rules lightly enforced by friendly red-hatted security personnel – families from nearby council estates, executives at the advertising and tech companies now locating here, journalists (full disclosure) from the offices of the Observer and the Guardian, which are just off the Argent estate.

All this is made possible by a rare degree of long-term thinking in turn made possible by special circumstances. One is that the main backers are pension funds, which by their nature take a long view of investments. Another was a seven-year period before construction could start, as the high-speed line to the Channel tunnel was being built across the site, which gave time for considered planning and consultation.

Also significant was the fact that there had been less sensitive proposals for the site, in the early 90s, which had prompted the formation of strong-minded local opposition groups. This episode had made the borough of Camden, in whose territory most of the King’s Cross site falls (the rest is in Islington) sceptical about property companies. Locals and politicians created pressure that developers couldn’t ignore. Then, in the early years of this century, it required thoughtfulness, patience and diplomacy on all sides to come up with the plan that is now being realised.

Two individuals in particular made it happen – Camden’s then director for the environment Peter Bishop, recently described to me as a “saint” by one who has seen him in action, and Argent’s then chief executive Roger Madelin, who went to meeting after meeting with the area’s very many interested parties. Madelin also used to show diagrams of the many constraints governing the site: mainline trains, underground trains, the canal, listed buildings, a corridor protecting the view of St Paul’s Cathedral from Hampstead Heath, which limits the height of buildings.

Given so many pressures and constraints, a certain defensiveness was to be expected. Madelin was never going to give himself an additional degree of difficulty by commissioning an architecturally radical scheme. In any case this was the spirit of the age – thanks partly to the intervention of Prince Charles, during the 1980s, in the proposed redevelopment of Paternoster Square, next to St Paul’s, singular monoliths were out. Constructed variety, in which different architects give different wrappings to fundamentally similar office or apartment blocks, was in.

Argent hired the classicising architect Demetri Porphyrios and the tactful practice of Allies and Morrison to produce a masterplan of traditional urban forms – city blocks arranged around squares and streets, whose formality is then offset by the asymmetries and incidents of the site. An agreeable fiction is created, that these blocks were not all created by a single entity at about the same time. A number of styles co-exist: emulations of continental housing blocks in textured brickwork, the diluted classicism of a Porphyrios office building, an aesthetic that Evans calls “industrial luxury”, expressed by the satisfyingly sturdy cast-iron columns of an office block by David Chipperfield, or by the rust-coloured oxidised steel of another by Eric Parry.

A building by David Chipperfield’s practice on the site. Photograph: Sophia Evans for the Observer

So how, then, could anyone complain? How many more goodies will we demand from the developers’ sack of gifts? And why am I possessed by the irrational desire to hire a small submarine and torpedo the blameless jazz-playing floating bookshop? How churlish can you be?

The first and maybe least important quibbles are architectural. Many of the buildings are handsome and few are poor, but eventually the dissembling of power and the avoidance of conflict become oppressive, or enervating, or both. It’s great that Argent have restored the mighty industrial structures, products of more brutal economics than those of the current development, but they are somehow neutered by the tasteful landscaping and cladding that surrounds them. One of the old gasholders is left as an empty frame, for example, a powerful structure that needs no embellishment. But embellished it is, by a fussy installation of mirrors at its base.

There’s awkwardness and rigidity at the edges of the different elements, a lack of give and take that becomes acute where the development’s north-eastern boundaries meet the rest of the world. There’s indeterminacy in the spaces between contrasting structures. Before this was a place of drama, made of shifts of level and clashes of scale. Now it’s smoothed out, tending towards the condition of a high-design tea towel. It’s possible that the forthcoming Google HQ, a 1,000ft long beast by Heatherwick and the Danish-American practice BIG, will do something to counter this tameness. It will have, at the minimum, a certain confidence and consistency.

More generally, unease comes from management and the feeling of being managed, the sense that everything is calculated and little is truly spontaneous. The presence of art and music highlight this feeling, these being activities that live off improvisation and the unpredictable. You know that if anything genuinely challenging happened here it would be escorted off the premises.

Granary Square, along with most of the streets and squares, are examples of what is now called Pops – privately owned public space – since the London borough of Camden has so far declined an option to adopt them, presumably because it doesn’t want to pay the running costs. Argent points out that all such space was previously shut off from public use, sometimes with brick walls, so it has taken nothing away from the public realm. Rather, it has added something new, but it’s still the case that its Pops doesn’t feel like an actual piece of city. Among the signs is that the homeless, if they are there at all, keep a very low profile. They certainly don’t ask you for money.

A computer-generated image of the vast Google headquarters now under construction. Photograph: HayesDavidson

Everyone who enjoys Granary Square is in effect a guest of Argent, which means that subtle shifts in management could make them less welcome in the future which, if Coal Drops Yard is the future, would be bad news for people who don’t want to buy fancy tea towels and Aesop soap. At present it is part of the mix, a spot of West End luxury to go with everything else. Anyone can go there, if they like, to gawp at the Heatherwick kiss or watch their fellow citizens, but there’s not much to make them linger if they don’t want to shop. If the Coal Drops ethos becomes that of the whole estate, and the coming of Google is likely to push it that way, then Argent’s ambitions to make it an everyday bit of London will fail.

On the scale of iniquities and crudeness of which property development is capable, any chinks in Argent’s virtue are minor stuff. It’s also hard to know what Argent could do to counter the feeling that it’s a bit too neat and tidy – hire dirt consultants? Permit licensed beggars? Curate prostitution? I’d say it could push its architecture harder and generally lighten up a bit. Otherwise King’s Cross is what it is, namely the work of a single estate, which is a London tradition: it’s how areas such as Bloomsbury and Belgravia got built. The upside is that the job actually gets done, and that places like Granary Square can be created. The downside is the over-managed feel.

In a better world King’s Cross would set a standard from which to improve. It’s possible that Madelin, who is now working on the redevelopment of Canada Water in south London, will achieve just that. But in other parts of the capital, in Vauxhall Cross and around the Old Kent Road, current and planned development is unlikely to reach the levels of consideration and public benefit achieved by the collaboration of Camden and Argent, not least because local authorities have been significantly weakened. One day this might change. Meanwhile it’s useful to see King’s Cross for what it is: an impressive achievement, but a not a normal piece of city.